Managing costs with time-of-use rates

The vast majority of homes and small businesses in Ontario are billed for their electricity using time-of-use rates. We set these rates. Understanding how time-of-use rates work is a first step towards helping to manage your electricity costs.

Electricity prices remain virtually unchanged starting May 1

The OEB announced that there will be little change to electricity prices on May 1. Read more

Did you know that it’s cheaper to plug in your computer at 9 p.m. than at 9 a.m.? Or that you’ll pay less for electricity by using your electric lawnmower on the weekend than during the week? Shifting your electricity usage to times when electricity is cheaper is one way to lower your electricity costs.

Electricity time-of-use rate periods

Time-of-use rates are different depending on when you use electricity. There are three periods:

Off-peak, when demand for electricity is lowest. Ontario households and small businesses use the majority of their electricity – nearly two thirds of it – during off-peak hours.

Mid-peak, when demand for electricity is moderate. These periods are during the daytime, but not the busiest times of day.

On-peak, when demand is highest. These are the busiest times of day – generally when people are cooking, starting up their computers and running heaters or air conditioners.

Why time-of-use rates vary

Time-of-use rates vary according to demand. They are cheapest when demand is lowest: during the evenings, on weekends and on holidays.

In Ontario, when demand is lower, most of the power we use comes from sources like nuclear generators and large hydroelectric stations, which are designed to run all the time. This is called baseload power.

As daytime begins, more people turn on their lights and appliances, and businesses ramp up their operations for the workday. These are high demand times for electricity. If all of the baseload power is used, the province turns to other sources like natural gas-fired generation, which typically costs more than baseload.

Time-of-use rates follow a similar pattern: as the demand for electricity rises, the price increases, and as it decreases, so does the price.

Summer and winter rate periods

People use electricity differently depending on the season, so we established two sets of time-of-use rate periods: summer and winter. No matter which season, on weekends and holidays the cheapest rates are in effect all day. The charts below show when time-of-use rates apply in summer (May 1-October 31) and in winter (November 1-April 30).

SUMMER WEEKDAYS

May 1 – October 31

In summer, electricity use peaks during the hottest part of the afternoon, when air conditioners are running on high. On-peak hours are mid-day.

TIP: Use your air conditioner early in the day and overnight, during non-peak times. You’ll pay less than if you use it mid-afternoon.

WINTER WEEKDAYS

November 1 – April 30

In winter, less daylight means electricity use peaks twice: once in the morning when people wake up and turn on theirlights and appliances, then again when people gethome from work. There aretwo sets of on-peak hours to reflect this.

TIP: Plug your computer in during the evening to do your online shopping, rather than mid-day. You’ll save more by shifting to non-peak times.